Vertical AI's Bitter Pill: The Rise of Horizontal AI
This post explores the competition between vertical AI applications (AI optimized for specific domains) and horizontal AI applications (more general-purpose, scalable AI). Using personal experience and Hamilton Helmer's Seven Powers framework, the author argues that as model performance improves, vertical AI applications struggle to maintain a competitive edge. Except for a rare few possessing exclusive and essential resources, most vertical AI applications will eventually be overtaken by superior horizontal AI. Horizontal AI, akin to a remote coworker, is easily integrated, cheaper, and continuously improves performance through model advancements. The author uses their AcademicGPT project as a case study, showing how a vertical AI application was surpassed by more general horizontal AI models.